FLE, a relatively new player on the CEE investment market, plans to acquire €100 million worth of assets just in Hungary and expects new investors to join the race. Dr. Alexander Klafsky, LL.M. MRICS, Managing Partner at FLE GmbH talked investment strategy and market expectations.
FLE has already announced two CEE acquisitions in January. What are your further plans for 2018?
In addition to the two assets in Budapest we also acquired a mixed-use asset (hotel, office & little retail) in Wroclaw, Poland, at the end of last year. Our plans for 2018 are further expansion in the CEE area, notably in Hungary, with an investment volume of around €100 million.
How would you summarise your investment strategy for the region? What type assets are you looking for?
We are mainly looking for completed and modern office buildings and hotels possibly with some minor retail components. The assets could offer mixed-uses as well. Essential for us is an outstanding location and excellent public transport connections as well as the property's efficiency and technical quality.
Are you looking beyond the core markets of Central Europe?
We want to concentrate on Poland, Hungary, Czech Republic, and Slovakia.
In your opinion which is the most attractive investment destination within the region?
In my opinion we get the best combination of market dynamics, price, quality, and infrastructure in Budapest.
How do you think financing conditions have changed over the last year?
The competition among financial institutions has apparently become fiercer and the financing terms changed to the benefit of the borrower.
What is your outlook for 2018 on the CEE investment market?
I believe we will see new market entrants and a culmination of investment activity in the first half of 2018, than a gradual slowdown towards the end of the year.
FLE GmbH with its seat in Vienna was founded in 2007 and is part of the French LFPI group. LFPI is an independent international multi asset manager with more than €3 billion of assets under management in private equity, real estate, debt and other fields of asset management. The real estate funds managed by LFPI group are owners of approx. 200 real properties with an estimated net value of more than €2 billion.
FLE GmbH is investment advisor of several real estate funds. These funds target office and retail assets as well as low budget hotels with a purchase price from €2 million to €50 million per asset in Germany, Austria, and CEE.
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